The Supreme Court on Wednesday stepped in to correct what it called an irrational exclusion of a contractor from a major Chhattisgarh road project, reminding authorities that tender conditions cannot be read selectively to knock out otherwise eligible bidders. Sitting through the hearing, it was clear the Bench was uneasy with how joint venture experience had been brushed aside without any clear rule backing that approach.
Background
The dispute arose from a Public Works Department tender issued in January 2025 for construction of a 27-kilometre road in Korea district, Chhattisgarh. M/s Surguja Bricks Industries submitted its bid, relying partly on experience gained as a 49 per cent partner in a joint venture that had executed a similar road project worth over ₹4,900 lakh.
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However, during technical evaluation, the department disqualified the firm. Officials said one experience certificate was from a joint venture and the other individual work did not meet the required value. The High Court at Bilaspur refused to interfere, holding that tender authorities are best placed to interpret their own conditions. This pushed the contractor to the Supreme Court.
Court’s Observations
The Bench closely examined the tender clause requiring “each prime contractor in the same name and style” to have completed similar work of a specified value. Importantly, the judges noted that the tender documents nowhere expressly barred counting experience gained through a joint venture.
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Referring to earlier rulings, including New Horizons Ltd., the Court stressed that in commercial contracts, experience is assessed from a practical, business-minded perspective. “The bench observed, ‘There is no specific or explicit exclusion of work experience gained by a contractor as a member of a joint venture,’” adding that vague eligibility criteria leave too much room for arbitrary decisions.
The judges also rejected the State’s argument that joint venture experience is indivisible. If a contractor has executed work as part of a joint venture, its proportionate share of that experience cannot simply be ignored, especially when the tender itself is silent on such exclusion. Doing so, the Court felt, offends Article 14’s guarantee of fairness and non-arbitrariness.
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Decision
Allowing the appeal, the Supreme Court set aside both the High Court’s judgment and the PWD’s decision disqualifying Surguja Bricks Industries. The authorities have been directed to reconsider the contractor’s bid by accepting its proportionate joint venture experience. No costs were imposed, but the message was clear: tender rules must be clear, and they must be applied evenly, without ad-hoc interpretations.
Case Title: M/s Surguja Bricks Industries Company vs State of Chhattisgarh & Others
Case No.: Civil Appeal No. 14859 of 2025 (arising out of SLP (Civil) No. 10039 of 2025)
Case Type: Civil Appeal (Tender / Contract Dispute)
Decision Date: 18 December 2025
